Toshiba rose to prominence globally in the 1980s and 1990s at the forefront of technology discovery. It took Toshiba 70 years for it to reach its peak and just a decade to fall into the abyss.
Sitting beside it are Sony, Olympus, Hitachi, and other Japanese tech conglomerates, sharing memories of glory days long past.
Prof Ulrike Schaede, who researches Japanese conglomerates at the University of California, San Diego, described Toshiba and its ilk as “full of yes men that do things because they think the boss wants them to do it, rather than what they think is a good idea or the right thing to do.”
As a result, “everyone’s moving in lockstep in the direction of the bosses, and you don’t get any new ideas.”
A 334-page report by an investigation committee set up by Toshiba on overstatement of profits showed that the leadership at times encouraged accountants to fudge the numbers. The acquisition of BNFL USA Group Inc. and Westinghouse U.K. Limited (collectively Westinghouse) has been identified to have been non-strategic.
Recently, Toshiba delisted from the Tokyo Stock Exchange after 74 years. It was taken private in an £11bn deal by a consortium of investors led by the private equity investor Japan Industrial Partners. This follows years of activist investor pressure on the company from foreign investors.
It remains to be seen how Toshiba will progress in the coming years. The happenings, however, leave us with some learnings. At the current churn rate, almost half of the companies on the S&P’s stock exchange will be gone in less than a decade. These seismic shifts in the marketplace have left organisations with a clear choice: transform at speed or risk total disruption.
The right strategy liberates the organisation from being merely ‘opportunistic’ to being able to evaluate and take advantage of the ‘right’ opportunities. Using a sailing analogy, it’s the difference between merely following the direction of the wind versus charting a course to arrive at a destination. There is enormous pressure on businesses today to create more and more value.
Organisations need to reconsider how they operate. Competition has long been the default mode for companies across industries — indeed, an element of competition will always be necessary to drive growth. But time has come to recognise that collaborative models may outperform purely competitive ones.
Understanding when and how to integrate these seemingly opposing approaches may just be the key to success in a complex, fast-changing world. The result is a bigger slice of the pie and survival for everyone. To do this right, instead of thinking about the service, product or process, companies must ask themselves this: what problem are we trying to solve?
If I cannot solve it alone, who has the piece of the puzzle I need? And, critically, how do I assemble these partners in the right mutually advantageous model to deliver a solution?
The writer is a Legal Counsel and a Certified Secretary. [email protected]
